10 Gifts That Keep on Giving

Gifts That Give Back

Sure, you could buy junior another plastic toy for Christmas, or you could get your spouse a bottle of perfume, some new clothes or a variety of other items that provide enjoyment in the short-term. But if you really want to give your loved ones something they’ll treasure for years, how about a gift that increases in value over time?
From shares of stock in a favorite company to rare sports memorabilia, investment gifts can provide the recipient with an attractive return if chosen wisely.
Here are 10 great suggestions to consider.
Photo Credit: Getty Images

A Gold Coin

Instead of giving your family member a card full of cash this holiday season, consider using that money to buy them a gold coin. Although no one knows exactly where gold prices are heading, what we do know is that the commodity’s value has soared in recent years, with gold trading at about $1,580 an ounce on Thursday.
One option is to buy a gold American Eagle Bullion coin created by the U.S. Mint, suggests certified financial planner Rick Kahler of Kahler Financial Group in Rapid City, S.D. But because the cost of a 1-oz. coin can be pretty steep, consider buying a lighter-weight coin (such as a 1/10-oz. or 1/4-oz. coin) if you’re on a budget. Although you can’t buy these coins from the U.S. Mint directly, you can visit the U.S. Mint website for a list of authorized dealers.
Another option is to buy an old gold coin, which will also have collector’s value in addition to its value just for the gold. For Christmas 2009, I received an uncirculated, 1/2-oz. 1906 Liberty Gold Eagle coin purchased from the American Precious Metals Exchange for about $500 at the time. The coin has nearly doubled in price to about $930 today – not too shabby. You can visit apmex.com for more options, including other pre-1933 U.S. gold coins that are valuable due to their limited supply.
If you’re planning on buying a gold coin, just make sure you get it from a reputable dealer. The coin should also come in a certified case from a professional grading company, such as PCGS or NGC.
Photo Credit: apmex.com

Stock

A piggy bank or a Monopoly set may be traditional tools to teach kids about money, but if you really want to get your child in on the action you should consider buying them some actual shares of stock.
Sound boring? It doesn’t have to be if you get them stock in a company they care about – just be sure to help them check its value throughout the year.
The site OneShare provides an easy way to buy a share of stock as a gift from more than 200 companies, including Disney (Stock Quote: DIS), Mattel (Stock Quote: MAT), Tiffany & Co (Stock Quote: TIF) and Hershey (Stock Quote: HSY). The website even gives you the option of ordering a beautiful frame for your stock certificate ($34 to $600 extra) with custom engraving ($10 extra).
Photo Credit: oneshare.com

Mutual Funds

Another good investment option for children, mutual funds allow for greater diversification than individual stocks, and can provide protection against market volatility. “If you want your kid to have some pocket change, buy two stock mutual funds that issue a dividend, and pay one out, and reinvest the other fund’s dividend,” says certified financial planner Debra L. Morrison of Trovena in Roseland, N.J. “Review the statement with your child every year and point out the terrific growth over time.”
Photo Credit: Getty Images

Art

Few investment gifts can be enjoyed as much in everyday life as a beautiful piece of fine art.
While there are no guarantees on how much a piece of art will increase in value, the Mei Moses All Art Index (which uses data on repeat sales from fine-art auctions) reports that the index was up 16.6% on an annual basis for 2010.
What kind of art should you buy? It depends on what your friend or loved one collects, but according to the Mei Moses Index, in the third quarter of 2011 the Impressionist and Modern sub-index was up 17% compared with where it stood at the end of 2010.
If you don’t have an extra hundred grand lying around, an example of a piece of investment-grade art on the lower price range includes this ink on paper piece by Francis Picabia, sold for $4,464 at a recent Sotheby’s auction.
Photo Credit: Sothebys.com

Fine Wine

Got an oenophile in the family? Consider buying them a bottle of fine wine that will appreciate over time. According to the Liv-ex Fine Wine 50 Index, which tracks the daily price movement of the most heavily traded commodities in the fine wine market across 10 different vintages, wine investments saw returns increase by 57% in 2010.
Of course, not every bottle is investment-worthy. As MainStreet has reported, wines that net a nice return at resale are those that are scarce, age well over time and come from a chateau with a long track record of great harvests – requirements typically only met by the top Bordeaux, Burgundy wines and a few California reds.
“Like art, this is more for the discerning collector, and you better do your homework,” says Kahler.
To find out which wines are the most in demand, you can check out sites such as Wine Spectator and Winedoctor, as well as the websites of major auction houses like Sotheby’s or Christie’s.
“What I like about this gift is that if it doesn’t appreciate, the recipient can always drink the mistakes,” Kahler says.
While some fine wines can fetch thousands or more at auction, investment wines with lower price tags include the Château Giscours—Vintage 2003, a Bordeaux that retails for about $80.
Photo Credit: tpetriep

Home Improvement Projects

Why not surprise your spouse with the promise of a home renovation in the new year? According to national averages from Remodel magazine’s 2011-2012 Cost vs. Value Report, a major kitchen remodel that cost $57,494 yields a 65.7% return at resale.
If you’re looking for a more minor undertaking, a $1,512 garage door replacement yields a 71.9% return and an $11,319 vinyl window replacement yields a 68% return. Check the website for the full listing of returns on other popular remodeling projects according to national averages, as well as breakdowns by region.
Photo Credit: Getty Images

College Savings Plan

It’s never too early to start saving for your child’s college education, and opening a 529 college savings plan can get the ball rolling.
“This is really the gift of a lifetime – it’s an investment today that you are making in your child’s future,” says Mark VandeVelde, wealth partner at Hefty Wealth Partners in Auburn, Ind. “It also offers some fantastic tax benefits.”
Indeed, earnings in 529 plans are not subject to federal taxes and, in most cases, state taxes either, as long as you use withdrawals for eligible college expenses such as tuition and room and board. The 529 also allows you to “stack” five years’ worth of gift money (up to $65,000 from an individual, or double that from a married couple) in the child’s plan without having to pay the federal gift tax, says Morrison.You can choose among several investment options for your contributions, including stock mutual funds, bond mutual funds and money-market funds, as well as age-based portfolios that automatically shift toward more conservative investments as the child gets closer to college age, according to the SEC website.
Photo Credit: Getty Images

Antiques

Like art, antiques are an investment that can be displayed in the home, and thus make a great gift if you’re looking for something tangible to give. Which antiques you select as your gift depend on what the recipient is interested in, but we consulted the Antiques Roadshow website for a few suggestions.
Some pieces with good investment prospects include character dolls (those with real expressions on their faces) made in Germany from 1908 through World War I, which can be had for as low as $200, and American pattern glass objects, most of which sell for less than a few hundred dollars. Or for a festive touch, consider handmade ornaments made from 1850 to 1900, which are priced around $50 to $75.
Photo Credit: Getty Images

Baseball Memorabilia

For the baseball fanatic in your clan, why not buy a piece of memorabilia for their collection? But buyer beware: Not just any baseball card or signed ball is a worthwhile investment. The key is to find rare ones, and the better the condition, the higher the value.
According to tips provided on the Antiques Roadshow website, signatures from Hall of Famers who died before the advent of card shows in the 1980s (in which players sat and signed autographs for hours) are valuable because they are in a more limited supply. Also rare and valuable are collectibles from black players, including those who played in the Negro Leagues while professional baseball was still segregated.
Photo Credit: Getty Images

Holiday Shopping Made Easy

Need some more gift ideas for the holiday season? Check out MainStreet’s roundup on some of the best online tools to help you find gifts, organize your shopping lists and stay within your budget!
Photo Credit: Apple.com